VC investments up slightly, fundraising at 16-year low

Venture capital investment enjoyed a moderate increase in 2010 to $1.1 billion, up 10% from 2009. But worrying signs for the future were reflected in VC fund raising, which hit a 16-year low with only $819 million in new funding. Despite a slow fourth quarter, VC investment was obtained by 354 firms, up from 337 in 2009, while the average financing size inched up to $3.2 million. Ontario received the largest share ($424 million compared to $296 million in 2009) for 37% of the national total. Quebec was close behind with $391 million invested, down 9% from the previous year but good enough to capture 34% of the total. British Columbia enjoyed a strong 2010 with an increase of 35% to $216 million, followed by Alberta which was up 8% to $67 million. Compared to the US, Canadian VC fared poorly, with Canadian firms receiving just 38% of what their US counterparts received. US VC investment in 2010 totaled $21.8 billion, up 19% from the $19.3 billion invested in 2009. Information technology received the largest share of Canadian VC ($484 million going to 126 firms for 42% of all disbursements), followed by software, telecom and Internet-focused companies obtaining $141 million, $135 million and $130 million respectively. Biopharmaceutical and life sciences firms received $299 million, up 38% from the previous year. Clean tech firms received $192 million, up 58% from the previous year. All data was generated by Thompson Reuters on behalf of Canada's Venture Capital & Private Equity Association ….